How Healthcare Revenue Cycle is Bearing the Brunt of COVID-19

Healthcare revenue cycle appears to be under severe strain as a result of COVID-19, with billing and coding, patient financial responsibility, and resource allocation come under its shadow.

With many nations announcing a lockdown, and authorities advising their population to stay indoors to avoid COVID-19, healthcare providers are under tremendous pressure to combat the outbreak of coronavirus. The impact of the virus has significantly influenced healthcare Revenue cycle Management and provider finances.

As many as 109,500 confirmed cases of COVID-19 have been reported across the globe, according to a World Health Organization report. At an average, 3500 new cases are being reported every twenty four hours, worldwide. The US too has declared the corona outbreak as pandemic.

Being in the frontline of testing and treating infected individuals, the healthcare providers have every reason to be concerned. Their major worry stems from the impact COVID-19 will have on the healthcare revenue cycle and financial operations.

The aftermath of COVID-19 is seeing the stock market experience its worst days, not since the financial crisis that happened 12 years ago have stocks plummeted so sharply. Even healthcare providers not immune to the trend are feeling the impact. Two major for-profit hospitals including Tenet Healthcare Corporation and Community Health Systems saw their stock prices fall significantly, with many other systems likely to follow suit. Similarly, non-profit hospital systems, academic medical centers, and physician practices too are facing similar financial challenges, as a consequence of COVID-19 .

In a study recently published in Lancet, ICU services were required for about a third of confirmed cases of COVID-19 that were reported in Wuhan, China, from where the coronavirus originated. Researchers also report that the mortality rates for the disease are high, with 41 patients under treatment, while six have since died from the infection.

A similar large study also confirmed the findings, with 2.3 percent fatalities reported, the mortality rate being significantly higher among the critically ill. The already-limited resources are under further strain following the intensive services needed to treat COVID-19.

Experts from the John Hopkins Bloomberg School of Public Health state that as a comparison, 46,500 medical ICU beds are available in the United States, and an equal number of other ICU beds could also be used in a crisis, however if it spreads over several months, the mismatch between demand and resources will be critical.

Shortages of personal protective equipment and key medical supplies like masks and ventilators are being reported by many hospitals, with many of them bracing for further shortages.

One of the most critical aspects during an outbreak is having the billing office running, so that hospitals and practices remain open for infected individuals requiring care. Understandably, COVID-19 demands are going to be a challenge for smaller organisations, with limited cash on hand, it is to be seen how they cope with these challenges.

CMS has come forward with a positive development to help providers overcome any medical billing and coding challenges associated with COVID-10 testing and treatment. Two Healthcare Common Procedure Coding System (HCPCS) were released by the agency recently, these codes can be used by laboratories to bill for certain COVID-19 diagnostic tests, they can also be used for the tests developed in-house based on new FDA guidelines.

Likewise, American Medical Association (AMA) too has announced that it will expeditiously develop a unique Current Procedural Terminology (CPT) code for reporting novel coronavirus testing.

In a recently released guideline on billing and reimbursement for treating COVID-19, CMS has reminded providers that Medicare will pay for evaluation and management (E/M) and other services provided in a beneficiary’s home by a physician or non-physician practitioner. Similarly, for many non-face-to-face services used to assess and manage a beneficiary’s condition, Medicare will reimburse the providers.

Hospitals, according to Medicare, will be paid a diagnostic-related group (DRG) rate, and any cost outliers associated with an entire stay, if a beneficiary is a hospital inpatient for medically necessary care. Patients that need to be isolated or quarantined in a private room will also receive payments.

CMS has also stated that hospitals reaching their capacities during an emergency may be able to add a remote location that provides inpatient services, even if a 1135 waiver is unavailable.

In a further support to providers, a proposal by the Trump administration is under consideration to implement a natural disaster program that would reimburse hospitals and other providers for treating uninsured patients infected with COVID-19. The providers will be paid 110 percent of Medicare rates under the program.

Following the COVID-19 outbreak, patient financial responsibility is already being highlighted. Reports have started emerging of patients incuriing thousands of dollars in medical bills after seeking treatment for potential coronavirus symptoms.

The ongoing struggle confronting healthcare providers to develop collection strategies in the era of high-deductible health plans and other cost-sharing arrangements will have to be on hold for a while, considering the emergency situation emerging following the COVID-19 outbreak

The difficulties arising from patient financial responsibility is being acknowledged by payers, who want to make it easier for patients to seek care, while having providers streamline the financial encounter.

In another development announced last week, America’s Health Insurance Plans (AHIP) will be implementing solutions that will lower out-of-pocket costs for people seeking testing and treatment for COVID-19. This would include solutions that will cover diagnostic testing costs prescribed by a physician.

Also underway are efforts by AHIP members who vowed to “ease network, referral, and prior authorization requirements and/or waive patient cost-sharing” for physician ordered COVID-19 testing. In order to provide effective treatment to those who are infected, the members propose to work with the providers, sharing information with them, mobilizing network providers, and promoting telehealth.

The healthcare system which is already overburdened, now has to deal with COVID-19 with overwhelming demands on the capacity of hospitals, emergency departments, and outpatient centers. According to the National Academy of Medicine (NAM), this will result in critical shortages of staff, space, and supplies, which will negatively impact patient outcomes.

It is critical for keeping operations functional for patients who need care, for which funds have to be allocated appropriately when demand starts to exceed the available resources.

Hospitals have been advised by experts from the John Hopkins – Bloomberg School of Public Health to use their flu preparedness protocols. This would be a starting process for allocation of resources for COVID-19 management. The organizations top priorities should be:

Actively Implementing these priorities should be the objective of all decision makers at various levels. This could include dedicating full-time infection prevention practitioners, stockpiling personal protective equipment, and identifying services and procedures that can be put on hold or deferred

Healthcare providers have been recommended by National Academy of Medicine (NAM) to develop “tiered, proactive strategies using the best clinical information and building on their existing surge capacity plans to optimize resource use in the event the current outbreak spreads and creates severe resource demands.”

Protect their workforce by offering staff childcare, alternate housing, balanced shifts, and additional support and training

Preserve personal protection equipment by reserving these supplies for those performing high-risk interventions, using powered air-purifying respirators in high-risk environments, continuous use of the supplies in a cohorted patient environment, and more

Optimizing outpatient services by extending hours, adjusting staffing, closing or reducing specialty clinic hours, and changing documentation

Allocation tips for other areas of care, including inpatient, critical care, and emergency department are also provided by NAM.

Concluding, the organization recommends that it is important for hospitals to initiate steps now to develop a process for decision making, and draw a list of resources that may be in shortage, while strategies to address a broad range of impact can be developed by involving the clinical staff.